U.S. Steel sees loss in 2012
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U.S. Steel reported a smaller than expected fourth quarter loss on Tuesday, but a wider loss for all of 2012, weighed down by the sale of its unprofitable Serbian operations last January.
The Pittsburgh steelmaker reported a fourth quarter loss of $50 million, or 35 cents per share, vs. a loss of $211 million, or $1.46 per share, in the year-ago quarter.
Sales fell 7 percent to $4.5 billion while shipments slid 3 percent to 5.2 million tons. The results included a gain of $9 million, or 6 cents per share, from the settlement of a contract dispute with a supplier.
Analysts had expected a fourth quarter loss of 75 cents per share on sales of $4.3 billion.
Chairman and CEO John P. Surma said first quarter results will be comparable to the fourth quarter.
For all of 2012, U.S. Steel lost $124 million, or 86 cents per share, vs. a 2011 loss of $53 million, or 37 cents per share. Sales fell 3 percent to $19.3 billion on a 3 percent drop in shipments. The full year results reflect a $399 million loss on the sale of its Serbian mills in January 2012.
U.S. Steel has not had a profitable year since 2008, when the global recession caused a precipitous drop in steel demand late in the year.
Mr. Surma said the company's mills were profitable on an operating basis -- before retirement expenses, taxes and others costs -- for the third consecutive quarter despite uncertain global economic conditions, fiscal problems in Washington, and competition from imports. U.S. Steel reported an operating profit of $11 million per ton in the fourth quarter, down from $32 per ton in the third quarter but better than a $5 per ton loss in 2011's fourth quarter.
During a conference call with analysts, Mr. Surma said there was nothing new to report on the possible sale of its operations on Slovakia.
The facilities, acquired in 2000, have a good cost structure and have performed well for the company, he said. Unidentified parties have expressed an interest in the mills and "we think we have a responsibility to our shareholders to explore that," he said.
"No decision has been made at this point," Mr. Surma said.
Asked about renewed talk of imposing a tax on carbon emissions, he said that would hurt U.S. manufacturers, adding that a carbon tax in Europe has made that region less competitive.
"If that's what we want, I can't figure out why," he said.
U.S. Steel shares closed Tuesday at $23.20, down 52 cents.
First Published January 30, 2013 12:15 am